naked capitalism

Reader and life-long Chicago resident John Bougearel asked me to reissue a post encouraging readers to participate in peaceful demonstrations during the American Bankers Association annual meeting in Chicago October 25-27. The sessions are organized by a coalition of community, consumer and labor organizations and are called “Showdown in Chicago“. You can find more details via the link.

A number of commentators are planning a series of related posts and hopefully op-ed and news articles around this time. William Black and Dean Baker are among those leading the effort.

John Bougearel reacted to something I wrote two days ago:

But per the social psychology research, this “you are in a minority, you are wrong” message DOES dissuade a lot of people. It is remarkably poisonous. And it discourages people from taking concrete action. I was surprised that some people bothered to comment on a post I put up yesterday, calling on people in the Chicago area to attend some peaceful demonstrations against the banking industry during the American Bankers Association national meeting, October 25 through 27. Some people weighed in, saying (basically) “don’t bother”.

I suppose it makes a difference whether one is old enough to remember the 1960s. Because people in large numbers got out and protested, two sets of changes that seemed impossible came about: civil rights for blacks and an end to the US involvement in Vietnam.

His comment:

I will be more than happy to be in the minority and told I am wrong. The truth of the matter is we who object are neither the minority or wrong. Being told such is intended to be dismissive and minimize our voice.

I have reached the point where it is high time to push-back on the message we are being spoon-fed and to educate and promote the message that it is time to push back on the powers that be. We can start with peaceful demonstrations in the style of MLK. What was startling watching the MLK and Malcom X video clips is how relevant their experience of being black in America relates to being middle class in America today. It is high time middle class America finds its voice and is heard above controlled messages press releases leaked to MSM.

We can not, above all, allow our voice to be drowned out by mainstream media and the powers that be who influence what is peddled through MSM. Our voices are certainly not being represented through our votes, and when that happens, it is no different than the early colonists who fought against taxation without representation. Since our votes find no voice in Congress or Capitol Hill, it is time for grassroots organizations to take over the role that was intended for our elected officials.

And I get the pseudo-protest and protest points cited above in comments, and I get the Malcolm X message, but the MLK message of non-violent protest is authentic and not pseudo as some might imagine. There is power in non-violent protest, resulting in change that can be durable and long-lasting. But an effort must be made at a grass-roots level and it must sweep through the nation.

Here are excerpts from the original post:

Dean Baker, a couple of days ago at Huffington Post, called on readers to go to Chicago to participate in peaceful protests during the annual meetings of the American Bankers Association on October 25 to 27. A coalition of community, labor, and consumer groups are organizing this “Showdown in Chicago.”

If you saw Michael Moore’s Capitalism: A Love Story, a disconcerting bit was his discussion of a series of research reports put out by Citigroup for some of its asset management client in 2005 on “Plutonomy”. It argued that a world ordered to suit the whims of the top 1% was well underway. The only thing that might get in the way was that the other 99% had the force of numbers on its side.

Sometimes it takes a show of numbers to change the dynamic. As Baker pointed out:

The elites hate to acknowledge it, but when large numbers of ordinary people are moved to action, it changes the narrow political world where the elites call the shots. Inside accounts reveal the extent to which Johnson and Nixon’s conduct of the Vietnam War was constrained by the huge anti-war movement. It was the civil rights movement, not compelling arguments, that convinced members of Congress to end legal racial discrimination. More recently, the townhall meetings, dominated by people opposed to health care reform, have been a serious roadblock for those pushing reform….

A big turnout at this event can make a real difference. Just to review the scorecard, most of the country is still suffering the fallout from the bankers’ irrational exuberance of the housing bubble era. The Congressional Budget Office (CBO) and other forecasters expect the suffering to endure for years to come.

As we noted yesterday, ordinary people who still have jobs are often seeing their wages cut, while Wall Street, the beneficiary of rich subsidies, is expecting a banner year.

If you live in or near Chicago, see if you can organize others to join you. And dress nicely! One favorite strategy is to dismiss protestors as ruffians.

Dear patient readers,

The manuscript has gone in after copy edits and some major revisions (some across the book reordering to tighten the argument and clear up redundancies, and a ton of work on one chapter which has some primary research). There is still pre-galley proofreading (they do it and I review it) and I may be able to do some surgical interventions, but the big push is past.

I had a great deal of help in the final phase of this Bataan death march from quite a few readers, two of whom, Andrew Dittmer and Richard Smith, were very intensively involved in the ten days, and two others (Tom Adams and a reader who prefers to remain anonymous) were critical resources in nailing down some technical details on a complex trading strategy that the book discusses at some length in one chapter.

Others who have been involved in the book on an ongoing basis (Tom Ferguson, Doug Smith, Satyajit Das, Marshall Auerback, Rob Parenteau) provided badly needed sanity checks on a range of topics. A team of readers who had volunteered to do research (Doru Lung, Ben Fisher, Olivier Daviron, Falk Mazelis, Marc Kelechava, Iain Simpson, Jason Windawi, Megan Fries) provided prompt and helpful responses when I could not run something down quickly on Google. Kristina Melomed took up the task of citation checking.

Ed Harrison stepped into the breach on the blog, not only providing quite a bit of his own commentary, but also taking on the additional task of vetting and posting guest post submissions.

This is only a partial list of the people who made important contributions to the book, but I wanted to single out the ones who helped with the final push to get it completed on time.

I am still a bit fried and want to get back to blogging, but I also did not read ANY news for a week, which makes me a bit nervous about the risk of saying something and missing a critical detail. So I will be in catch up mode on a number of fronts which probably means lighter than normal volume for the next few days.

Thanks again for your interest and support!

Ping me please @ yves@nakedcapitalism.com, thanks!

Yes, this is reminiscent of Desperately Seeking Susan, hopefully without a missing jacket and amnesia.

Dear patient readers,

I will not bore you with details, but we had some technical difficulties. I could not view or access the site since late afternoon yesterday, and was therefore unable to post. I gather many readers could still view the site (at least until this morning) but could not comment.

This WordPress transition is proving to be quite painful, and I am at a loss as to understand why. Sincere apologies.

Since some of you are fond of the Antidote du Jour, I am providing one below.

Dear Patient Readers,

We are still debugging the WordPress version of the site. It was taken offline by our webhost for about an hour, much to our consternation.

I also learned that the blog was set up to filter spam comments. It seems to be overly zealous in doing so, in that the number tagged looks to be way above what I would see on a normal basis with Blogger.

So rest assured, I have not deleted or barred comments, this is a WordPress feature we need to tune. I am getting my WordPress expert to do something about it when he is back on line tomorrow.

We will be transitioning this site from Blogger to Wordpress (and a new hosting service) this evening. The ability to leave comments will be disabled for approximately an hour until the transfer is complete. There may be up to a 20 minute service outage when the actual switch happens.

For readers there should be no changes required to continue reading us via the website, email or newsfeed. However anyone posting comments or articles (i.e. guest bloggers) will notice a few changes to the editor interface.

There will be another notice posted here once the transition is complete.

Dear patient readers,

Loyalists may have noticed that I am still not back up to my old level of posts. That is because I still have heavy duty book responsibilities. I now know why Spaulding Grey called one of his books “the monster in the box” (in the box in those days because manuscripts were typewritten).

The manuscript was in to my editor August 4. I still don’t have her edits back, but I have tons to do anyhow (this is typical, BTW) particularly because one chapter still does not work and needs to be rewritten yet again (9th time, 7 of 8 previous rewrites were major. It does not want to submit). And aside from cleanup and nailing down some very important open details (to say anything about CDOs, you need to do primary research, the media did not get deeply enough into that one, no doubt because it is a difficult product and data does not converge neatly), I need to worry about continuity and redundancy (for instance,when I talk about CDS and return to it 4 chapters later, how much do I have to reintroduce the concept for a lay reader?).

The book was supposed to go to copy edit August 18, which was clearly nuts. I had to make myself obnoxious to get that pushed back a mere six days. I get half the book back out of copy edit Sept 2, the rest the following week. The overall deadline is still the same, which is the manuscript is pretty locked down on Sept 23.

I review copy edits and can still make changes till then, and will keep editing while in copy edit. I also need to get some permissions for a few charts I use before Sept 23..

The manuscript then goes for a proofreading (an extra step most publishers don’t take) and goes into page proofs, which I review again, but you really cannot change page proofs much at all (you can maybe artfully change a line if if does not change the rest of the page).

The book goes into galleys as of mid October and galleys are ready Nov. 1.

And you may remember the book is not out until late Feb-March. Why such a long lead time? They want to send galleys to long lead time publications. It takes time to assign books to reviewers. To get reviews in some magazines for Feb-March, they need galleys 4 months plus prior.

Now this book is a big historical sweep, but I wonder what happens if this ides of September is even a pale shadow of the last one.

And I have a client project starting the day the book goes into copy edit (Aug 24), so even if I wanted to take a few days off then that is not in the cards.

Dear readers,

There are some points in the book I need to nail down re CDOs (particularly mezz CDOs, circa 2006 and 2007) and the various relative value plays major banks and hedge funds were engaging in around that time. I may also have some questions re CLOs, to the extent that hedge funds were engaged in relative value plays with tranches from those deals. As a result, I will probably also have some questions re synthetic CDOs, since any shorts against CDO tranches during this period probably wound up in synthetic CDOs (for instance, who was packaging them, who was buying them besides stuffees in Australia and the Arctic Circle).

I’ve made a reasonably through search, and some readers have sent me some very useful material, but I still have some gaps.

If you are up for a chat via e-mail or phone, please ping me at yves@nakedcapitalism.com, and please put “CDO” in the headline. Thanks so much!

A bit of advice: do not try to do an ambitious book on a compressed schedule. If I didn’t have quite a few people helping on important aspects, it would be impossible, but even so, this take a ton of persistent effort.

To wit: all the chapters are in to the editor, I believe I have a month for edits, and like apparently pretty much everyone else, there is still a lot of dorking I need to do at various points (ie, need to divvy one over-long chapter into 2, most academic chapter still has my experts on my case re quite a few points, one chapter needs two arguments added, one chapter has an important section that needs further unpacking and rework, and then I need to look at the whole book and see how to clarify the main arguments across the chapters).

But in roughly a month, the text will not be “final” but major changes would be bad form. For instance, it gets sent out for a copy edit (which I do review) and a final proofreading. One chapter will be held open till the last minute, which is mid-October, for possible news impact, but the rest will be pretty locked down.

The reason for the insane-seeming lead time (book goes to galleys October 15, galley out in November, pub date early March) is the galley process and physical distribution. I was told the only way to compress the process was to skip galleys, which they recommended against, since it would hurt sales. (galleys are important for reviews in long-lead-time mags). And no joke, physical distribution is a month. The books get shipped the first week in February.

Considering all that, I believe in meeting deadlines, and although I did miss it, by the standards of publishing, it was not by much. The due date was Saturday Aug 1, and with that being a weekend and my editor being on holiday, that was the functional equivalent of start of business Aug 3. It went in less than 24 hours after that.

There is still a lot to do, but not as pressured as before, thank God. And the draft is much longer than called for (I guesstimate 130,000 words vs. 60,000 to 80,000 per contract), which I think was necessary given that I am making a big hairy argument. That may actually ruffle some feathers at the publisher, but my draft readers do not seem to mind the chapter length. In fact, the ones that have gone over the best are the longest ones. The prose is not flabby, so I don’t think they can lose more than 10% without cutting substance, and I (of course!) think the detail is important. Will be interesting to see how that goes.